What if I told you your business’ productivity is only 80% of what it can be? Like any executive, you’d want to know why you’re missing out on 20% of your growth potential.

For many U.S. companies this is the case, but the problem runs deeper than this surface-level symptom.

Poor employee engagement is the culprit—and its ill effects don’t stop there. A 2017 Gallup study found companies with disengaged workers face:

  • 37% higher levels of absenteeism,
  • 49% more workplace accidents,
  • 60% more errors,
  • And the kicker, 18% lower productivity.

So who’s the culprit here? While the disengagement drivers are varied, one factor abounds: high-pressure, stress-inducing culture.

In a report titled “Paying With Our Health,” the American Psychological Association reports that organizations like these cause the loss of  more than $500 billion annually and result in 550 million missed working days.

Abysmal statistics continue to cascade from workplace-induced stress, from pinched profit margins to violence to early death. The way we run our companies has an outsized impact on the lives of real people, because behind every number is a person. 

As leaders, it’s paramount we analyze our own cultures to ensure we’re fostering positivity, support, and well-being. 

What Can Leaders Really Do?

A fair question is how much can leaders really impact culture? (Especially those who run Fortune 500 companies with tens-of-thousands of employees.)

If we turn to peer-reviewed research, the answer is leaders are the primary drivers of culture, rather than a cog in the great organizational machine.

Organizational cultures were significantly (positively) correlated with leadership behavior and job satisfaction, and leadership behavior was significantly (positively) correlated with job satisfaction.

As leaders, it’s vital that we model and encourage positive behaviors, attitudes, and responses because everyone’s success hangs in the balance.

My company is fully-distributed, with over 100 employees in 23 U.S. states. More than that, we highly value flexibility and work-life integration—so much so, our employees even set their own work schedule.

However, according to another Gallup poll, on their own, even benefits like these aren’t enough! Instead, the most predictive indicator of well-being is employee engagement.

No matter the perks, the refrigerators packed with snacks, the on-site barista, or even nap pods, nothing can replace the number one driver of employee engagement and well-being: a positive culture.

3 Things Every Leader Can Do To Cultivate A Positive Culture

A study in the field of Positive Organizational Scholarship found key factors that drive well-being and high performance over the long-term. Here are three I’ve seen work in our own culture that you can put to work today.

1) Take the lead on healthy boundaries and watch your business grow.

It’s no secret: high-performers often love to work. They’re brilliant at what they do, care deeply, and crave success. So these are the A-players we all want to hire. But when we aren’t careful, their drive to excel can easily set them on the path to burnout.

Coupled with the fact that employees often feel pressure to put in more hours, it’s important for leaders to set the pace on what work should (and shouldn’t) look like.

To increase positivity and support, leaders can take the lead on healthy work-life boundaries. When this happens, the impulse works its way into your team leaders’ and managers’ styles.

One of my favorite stories is about one of our new employees who came from an “always on” culture. Her team leader coached her to turn her notifications off at night and keep work to working hours. “Support your clients, but also take care of you,” she said.

What’s phenomenal is we can directly attribute new client referral growth from that new, boundary-setting employee. Despite working fewer hours, she is producing more for our company. 

In my experience, a positive culture is one of the best referral marketing strategies.

2) Take every opportunity to show empathy.

In 2012, a group of researchers asked a question: how much do positive and negative leaders impact their employees’ brains?

The study invited high-level professionals to recall interactions with both empathetic (“resonant”) leaders and un-empathetic (“dissonant”) leaders. And they found the memories fired specific parts of their brains exactly mirroring positive and stressful responses.

For instance, memories with dissonant leaders engaged regions related to “avoidance, narrowed attention, decreased compassion, and negative emotions.” 

Sounds like a recipe for a disengaged employee, no?

Those memories of positive interactions fired regions associated with the “social network” and “positive affect.” Employees with empathetic leaders are more engaged, more connected, and more positive than those with negative leaders.

Showing sensitivity to difficulties in your employees’ lives will create a culture that supports well-being and alleviates suffering. Empathy from the top down creates a workplace that recharges and heals its employees even through difficult times.

3) Be interested in your team’s lives beyond the clock.

Obviously, every one of us has a life outside of the office (some of us less than others)! And keeping this in mind is helpful in both culture building and retaining top talent.

Counterintuitively, research shows that allowing employees to bring their outside interests into the office has a net-positive impact on engagement, well-being, and fulfillment. How so? It builds a strong sense of community that transcends shared spreadsheets, quarterly goals, and Friday all-hands meetings.

Another of my go-to anecdotes for this is our team member, Crystal. We make a point of talking a lot with our people, and she’s been most surprised by the strong sense of community and supportive culture she feels—even in a fully-remote company.

What’s exciting is this is because of our team, not any genius benefits or employee bonus scheme. My part in this is small, it’s the community itself driving this. 

Crystal said this started in her onboarding experience, saying, “By the time you get fully onboard you feel like you’ve observed and know everything; like you’re part of something.”

Here’s the truth, culture-building starts in the interview process, before an employment offer is ever made. Hire the right people and then support them. As the data have shown, the higher the engagement and satisfaction, the healthier, happier, and more productive your entire organization will be.

What’s Next For Your Culture?

The science is in: positive cultures grow businesses. I know this first hand. Plus, I can’t think of a better way to increase ROI than leading with empathy, interest, and support.

So, what’s next for your culture, where can you encourage positivity?